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Chances are you’ve heard about Lulea, a small town in northern Sweden only if you’re a fan of Movits!, a local Hip-Hop band, or one of those who knows everything about Bond girls. That was true until last Thursday when Facebook announced it will build its first data center outside the US and the largest one in Europe in Lulea.

Why Lulea of all places? Facebook said on Thursday it had picked the northern Swedish city, just 60 miles south of the Arctic Circle, because of its access to renewable energy and the cold climate that is crucial for keeping the servers cool. In other words, Facebook “Likes” it cooler and greener.

It is definitely cool, not to say freezing, in Lulea. The average daily temperature there ranges from high of 41F degrees to low of 27F degrees. Facebook spokesman Michael Kirkland explained that “the cool, dry climate will allow us to continue our practice of using outside air to cool our data centers.” Facebook added the site also provides a power infrastructure using independent sources that are directly connected to the national grid, which allows the company to limit its generator topology. It means there will be less need for dual redundant substations and as a result Facebook will be able to reduce the number of backup generators installed by 70 percent. In addition, excess heat from the servers will be captured and re-used to heat office space in the facility during the colder months.

The new data center won’t be just super energy efficient, but will also get most of its energy (120 MW in total) from renewable energy sources. It will be primarily powered by hydropower, using the hydropower stations on the nearby Lule River that produces about 13.6 million megawatt hours of hydro-electric power, equal to 10 percent of Sweden’s total demand for electricity. The rest will come from 14 backup diesel generators.

This is an interesting move on Facebook’s end. In February 2010, Facebook announced the construction of a massive data centre in Oregon. This facility was supposed to be very energy efficient, but at the same time receive power from PacifiCorp, whose energy mix is mainly based on coal. This decision angered Greenpeace, who started an Unfriend Coal campaign against Facebook, urging the company to increase the use of clean energy to become coal free by 2021, educate users about how Facebook powers its services and its carbon footprint and advocate for clean energy at a local, national and international level. Greenpeace reported that over the past 20 months 700,000 people joined its campaign.

The criticism against Facebook was intensified after Facebook released its “How Dirty is Your Data?” report on April this year, with findings showing companies like Facebook and Apple powering the majority of their online services through coal. Facebook was graded as the second most coal-intensive data-center operator (Apple was the first) with a 53.2 percent ranking.

It’s not clear what role this criticism played in Facebook’s decision to build a data center primarily powered by renewable energy, but their tone is certainly different this time. When they responded back in 2010 to the Greenpeace allegations, Facebook said Greenpeace is offering a simplistic explanation of how energy grids work, and that the company chose the location of its data center because it could be energy efficient. This time, they emphasized how the energy source was a factor in choosing the new location – Facebook’s spokesman said “this will be the first Facebook data center powered primarily by renewable power, primarily hydro. It’s a really important consideration for us. Obviously, it’s not the only consideration.”

The reaction from Greenpeace was positive, although a bit cautious – “This is a great step forward for Facebook, but we would like more details on how much renewable energy will power its data centre in Lulea,” said Casey Harrell, Greenpeace IT analyst. “Greenpeace also mentioned it was hoping to see similar leadership within the US, asking Facebook to use its power to advocate for a significant shift in investment with the utilities Facebook already has contracts with, Duke Energy in North Carolina and Pacific Power in Oregon, which rely heavily on coal.

Facebook is not the first company who is looking north for locations that offer cooler temperatures, which reduces both cooling costs and carbon emissions. Google, for example built recently a data center in Hamina, Finland, which is located in an old paper mill and includes an innovative seawater cooling system. With a vast renewable energy infrastructure, Lulea seem to offer even greater cost savings, as according to officials in Lulea, the area has some of the cheapest power rates in all of Europe.

Many data center managers are concerned with making their new data centers innovative and energy efficient. Yet, as is the case with Facebook in the US, when it comes to the resource of energy, cost still seems to be the main factor when companies make their choices. The Lulea data center is an important milestone because it is a clear example of a win-win model, where renewable energy wins not just because it’s green, but also because it’s cheaper. It remains to be seen if we will have similar cases in the US. If we do, there’s a better chance we’ll eventually have a clean ‘cloud’ rather than a dirty one.

Raz Godelnik is the co-founder and CEO of Eco-Libris, a green company working to green up the book industry in the digital age. He is also an adjunct professor in the University of Delaware’s Alfred Lerner College of Business and Economics.

Raz Godelnik is an Assistant Professor and the Co-Director of the MS in Strategic Design & Management program at Parsons School of Design in New York. Currently, his research projects focus on the impact of the sharing economy on traditional business, the sharing economy and cities’ resilience, the future of design thinking, and the integration of sustainability into Millennials’ lifestyles. Raz is the co-founder of two green startups – Hemper Jeans and Eco-Libris and holds an MBA from Tel Aviv University.